One of the bidders for regional sports networks that Walt
Disney Co.
DIS 0.38%
is selling has lodged a complaint with federal regulators alleging that cable operator
Charter Communications Inc.
CHTR 0.12%
is undermining the sale process by threatening to drop the channels from its systems.

In letters to the Federal Communications Commission and the Justice Department, Big3 Basketball LLC alleged that Charter’s conduct is depressing prices in the auction and suggested the situation could benefit Charter’s largest shareholder,
Liberty Media Corp.
FWONA -0.79%
, which is also a bidder.

Big3 said it has engaged in negotiations with Charter over the price the cable company would pay to carry the sports networks should Big3 be the winning bidder. Big3 said the discussions broke down and it now fears the channels will lose carriage.

“Charter’s conduct risks effectively excluding Big3 from the bidding process and tainting the auction,” the company told the FCC. “It has been suggested to Big3’s ownership that Charter has disseminated its threat to drop the (regional sports networks) to other members of the industry, thereby suppressing auction prices, chilling bidding, and ultimately hurting Disney’s ability to secure the best price for the (channels),” the letter said.

In a statement, Charter said it “welcomes the opportunity to discuss a future carriage agreement for these networks with whomever ultimately owns them including Big3. Regardless of who owns the programming, we approach all negotiations with the same singular objective of reaching carriage agreements that best meet the needs of our customers.”

Big3, which runs a 3-on-3 basketball league with backing from entrepreneur
Jeff Kwatinetz
and rapper and actor
Ice Cube,
told the FCC it lacks the leverage to compel Charter to carry the regional sports networks.

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